Genting Berhad’s flagship US casino, Resorts World Las Vegas (RWLV), reported a 5.5% quarter-on-quarter decline in revenue to US$206 million and a 32% decline in EBITDA to US$34 million in 2Q23, impacted by seasonally lower convention business, according to management.
In a Thursday note following the company’s Q2 earnings call overnight, Nomura analysts Tushar Mohata and Alpa Aggarwal said the convention business was down due to the hot summer weather, although this was already picking up through July and into August.
Hotel occupancy had also shown some sequential improvement to 90.2%, up from 89.9% in 2Q22 and 90.0% in 1Q23, while the average room rate was slightly higher at US$243.
For the first six months of 2023 combined, average hotel occupancy of 90.0% was up from 80.4% in 1H22, with the average room rate rising from US$234 to US$261.
“RWLV benefited from a mix of concert headliners and events, including the NFL Super Bowl and college basketball tournaments, paired with a robust convention quarter which drove strong visitation to RWLV’s property,” Genting said in its results announcement.
“With the growing return of conventions and business travel to Las Vegas, RWLV will have its highest mix of convention base room nights in 2023. New performances at the Resorts World Theatre and future projects are expected to drive significant foot traffic in the remainder of 2023 and beyond.”
In a positive for the company, Nomura observed that Genting had recently issued US$400 million senior notes due 2030 to refinance RWLV debt and that there were “currently no large capex plans and no further refinancing requirements in the near term.”